The invention relates generally to transaction systems for goods and services. More specifically, the invention is a system and method for the selling, reselling, and distributing pharmaceutical products (collectively the “system”).
The healthcare industry makes up a large percentage of the U.S. economy, and it has consistently grown at a faster rate than the economy as a whole. Within the large variety of treatment options that currently exist to treat a wide variety of medical conditions, the use of pharmaceutical products plays an ever increasing role within the universe of available medical treatments. Many medical conditions that can currently be treated effectively through the use of medication would in the past have required far more invasive treatments such as surgery or chemotherapy. Compared to alternative treatment options, pharmaceutical products are often the best option in terms of effectiveness, cost-efficiency, and patient comfort.
The importance of pharmaceutical treatment options in the modern treatment of medical conditions is difficult to overstate. The pharmaceutical industry is a highly dynamic sector within the larger healthcare economy. Billions of dollars are spent each year on the discovery and testing of new medications. New uses for existing drugs are discovered and marketed each year. The regulatory approval process for pharmaceutical products is both extensive and expensive. Whether a particular disease or medical condition impacts millions of people or only a few hundred, pharmaceutical products are often the first and best line of defense for patients.
The special nature of pharmaceutical products raises a variety of unique challenges to the efficient sale, resale, and distribution of such products. Prescription medications are regulated substances that can only be sold or distributed through properly licensed entities such as pharmacies. Thus the numerous online transaction sites that are highly efficient at selling and reselling a variety of products and services simply cannot be used for the sale and resale of prescription medications. Further complicating matters is that fact that different states have different licensing requirements and different laws pertaining to the resale of prescription medications that occur between licensed pharmacies. Many aspects of the pharmaceutical industry are highly regulated and thus generic resale and other distribution approaches used by the prior art for other types of transactions are not suitable for use with pharmaceutical products. Any effective online system that facilitates the distribution or resale of pharmaceutical products will need to be cognizant of the regulatory requirements that arise when dealing pharmaceutical products. The addressing of regulatory requirements is particularly important to the degree that the system attempts to incorporate automated processing into such a system.
The purpose and nature of pharmaceutical products themselves also complicate efforts to sell, resale, or otherwise distribute them. Most products are not associated with definitive expiration dates. Books, computers, MP3 players, furniture, cars, appliances, and other common products do not significantly decay at a specific predefined point in time. In contrast, a pharmaceutical product is often comprised of a specific combination of molecules designed to have a specific impact on a particular ailment. The fragile balance embodied in many pharmaceutical products is often highly vulnerable to the passage of time. Pharmaceutical products are often associated with definitive expiration dates after which they cannot be sold and should not be used. Use of an expired pharmaceutical product can loses potency, raising significant issues pertaining to the health and safety of the patient.
Certain other products, such as food and tickets, can be associated with expiration dates. However, the aging of a pharmaceutical product is significantly different from those products. A food or beverage product may become less desirable to consumers as it approaches or even passes its listed expiration date, however the product will in most cases still function as it was intended to. In many instances, a food or beverage product may be safely and effectively used even after it has technically “expired.” For example, the function of a ham sandwich is to be filling and to provide certain nutrients. Those functions are typically satisfied even if the component products are consumed after their expiration dates. A food or beverage product can be said to decay over time, but the impact of that decay to the consumer is often one of desirability, not effectiveness.
The decay of a ticket is also different from that of a pharmaceutical product, but in a manner that is opposite that of a food product. The effectiveness of a ticket for an entertainment event or a trip on an airline is not negatively impacted by the passage of time until after the event has begun or the plane has taken off, at which point the economic value of the ticket quickly drops to zero. In contrast, the decline in effectiveness and value of a pharmaceutical product occurs over a longer period of time and often in an incremental fashion.
.A variety of other attributes further distinguishes a transaction involving pharmaceuticals from transactions involving other types of products. For example, although pharmaceutical products are typically sold in a variety of package sizes to pharmacies, the pharmacies themselves often sell the product to consumers in partial units of those package sizes. In most non-pharmaceutical retail environments, the retailer does not modify or break down the package sizes of the products being sold. The pricing of certain pharmaceutical products can be subject to variety of constraints pertaining to various predefined discount levels that are influenced by third-party payor policies and payments, including but not limited insurance companies, government regulations and government payment mechanisms such as Medicare. Many pharmaceutical products require refrigeration shipping containers if they are to be transported.
The obstacles facing the efficient sale, resale, and distribution (collectively “distribution”) of pharmaceutical products become particularly pronounced with relatively uncommon medicines. The prior art approaches used for the distribution of highly used pharmaceutical products are relatively efficient. For example, prescription medications for the treatment of high cholesterol are used by millions of Americans. With such high and universal demand for those products, virtually every pharmacy in the country can keep a sufficiently large supply of the product to serve its customers while being confident that the vast majority of the product will be used up prior to expiration.
Prior art distribution approaches are far less efficient with less common pharmaceutical products that are used to treat far fewer patients. Outside the context of a pharmaceutical product, the sensible business approach is to sustain an inventory of high demand items and to forego including relatively rare items in the inventory of a store. However, in the context of a pharmacy, such an inventory policy is not acceptable given the dramatic impact of going without the pharmaceutical product. Thus, unlike other businesses, a pharmacy has reasons to sustain an inventory that includes rarely purchased products. When this factor is coupled with the reality that an individual prescription typically uses only a small portion of the package size that a pharmacy purchases from a wholesaler, the prior art distribution approach for such pharmaceutical products will often result in the expiration of the product before its use. Ironically, it is the hard to find medication that often ends up as expired waste. The more esoteric the medication, the greater the challenges in avoiding the undesirable tradeoffs between wasting unused pharmaceutical products on the one hand and avoiding shortages or unavailability of the product on the other hand.
It would be desirable to avoid the waste of pharmaceutical products and facilitate access to those products by facilitating pharmaceutical product transactions in an efficient and easy to use manner.